Mistakes To Avoid When Getting Homeowners Insurance

Home insurance may not always be mandatory, but it’s necessary to save money on future repairs, renovations, etc. After all, buying a home itself is a huge step. So, skimping on coverage for better prices or being careless with the T&C isn’t an option. You need to be careful about which homeowners insurance company in Palm City you choose and read the terms.

Minor mistakes you make when buying a policy could prove costly in the future. Here are some common mistakes you should avoid when getting a home owners insurance policy:

Focusing On Prices

Many homeowners focus on getting the cheapest coverage rather than the best one. While small premiums can help you save money, you usually get what you pay for when it comes to insurance. Paying small premiums means you might not get enough money for necessary repairs or your policy might not cover certain repairs or incidents.

So, price should be your secondary concern. You need to consider how much coverage the policy offers you to get the best deal.

Insuring Based On Real Estate Value

Many homeowners choose a policy based on real estate value so that they can negotiate for a lower price later. Doing this might mean you may not have enough coverage in case you need to rebuild the house after a disaster. So you need to choose a policy based on the estimated cost of rebuilding your home. 

Insurers usually require you to get policies that cover the complete cost of rebuilding your home or most of it. Failing to do so might result in penalties like a reduction in the claim amount.

Making Assumptions About Coverage

It’s dangerous to assume that your policy will cover everything related to your home. The policy may exclude things like floods, earthquakes, etc. You must read the fine print to know what’s covered and what’s not. If you don’t understand some terms, ask the agent to explain them to you.

Another assumption to avoid is about your deductible. While some insurers charge a flat deductible, others might charge a percentage-based amount. Clarify this with your agent before getting a policy.

Skipping Flood Insurance

Most Americans tend to skip flood insurance when getting a policy. This can be a big mistake in the event of a hurricane or other flood events. If you live in a flood-risk area, then you must have a flood insurance policy.

Thinking Your Policy Covers Your Tenants

Your policy usually only covers you and your family’s property if you include them. If you are renting your home to someone, your landlord policy will not cover their liability and losses. They need to have their renter’s policy for that.

Not Researching Insurer

Some insurers may not be performing well. They might go out of business at a time when you need coverage. Some insurers might have lousy customer service that you find out about only after signing their policy. Research their financial strength and customer service before purchasing their policy.

Even if the first company you come across seems legit, it’s usually a good idea to go through multiple firms. The first might be good but the second might be even better. Go through their reviews and check out agencies dedicated to determining the quality of insurers. An independent agent can also help you find the right insurance firm for you.

Not Bundling

A home insurer may also act as an auto insurance agency in Palm City. This gives you the chance to bundle different policies together. Bundling policies is a good idea because it helps you get good discounts. You can also customize your policy based on changing lifestyle needs.

Sticking With Old Policy

Your lifestyle needs change with time. You might have added new appliances and devices since the time you bought your house. Update your policy after every major change to ensure that you get maximum protection.

Getting Deductible That’s Too High Or Too Low

A high deductible means a low premium and vice versa. Don’t go for either extreme. It’s best to consider your budget when negotiating the deductible.